We've been highlighting partnering with your body companies and other suppliers and putting together promotions with their assistance. Today, I want to talk about another way you can partner with your body company that will also help you with your promotions.
First, I want to mention here that all of these bold posts have less to do with aggressiveness and more to do with focus. The way to move the commercial truck department forward is to focus on it. By focus you will plan things out, you will ensure that things get done and you make it the forefront of your sales efforts. By concentrating on commercial upfitted trucks and businesses who use them, you are automatically building relationships that will bring 75% of your total sales in other products your dealership sells. The commercial truck is the way in. As a result of this, it is worth your focus because it is the foundation of a strong department with strong gross profits.
I talked about planning your promotions out a year in advance in yesterday's post. That requires focus. I mentioned that you want that planning so that you have your favorite pool companies order the inventory you need so it is available when you need it. Today, I will elaborate on this aspect of your focus and planning.
Because you are a leading edge genius, you are going to be different on purpose. In addition, you will focus on things others take for granted. For example, many dealers just take whatever the pool companies order up. But, you are different because you have a strategy that you want certain options and combinations that help you in your marketing. For example, you think the limited slip axle is one of the easiest options in the world to sell and provides great value. The pool company has that on a few units, but you want it on all of your units. So, you have them order them for you. You also like some colored units, so you have them order some of those for you. Any options or combinations or chassis they don't normally stock, you can have them order for you.
When you do this, this gives you maximum flexibility in your stocking operation and helps to minimize your flooring expenses. You have to have a good relationship with your pool company so they know that you will take the units and not leave them high and dry. So, with this maximize inventory and minimize flooring expense theme, here's how that looks from the big picture:
The pool company typically has 90 days of free flooring and some may have a bit more than that, but for the sake of this example, we will just use 90 days that you can be assured of. After 90 days, they start paying flooring and you don't want them to do that, so you have to take it out of the pool by then. At the same time, you probably have up to 120 days free flooring as a Ford BPN dealer, but we will use 90 again to be safe. So, doing the math, 90 and 90 is 180, or six months of total free flooring. That's half a year! Ordering empty chassis for your lot from the manufacturer makes no sense whatsoever to me. You get about 60 days and that is it, plus essentially, you have an unsaleable piece until it gets a body. This is a flooring creating machine! Not good. But, you're the leading edge commercial truck genius, so you order all your units through your partners so that you have up to 90 days to take it and then 90 on your lot to sell it.
If you can think of your inventory from this perspective, you can really reduce your flooring expenses by planning out your needs well in advance of the need and partnering with your pool companies. In this case, I would work with a number of pool companies, so that you have lots of flexibility and they don't see a large potential downside. Make sure that you follow through and take all the units that you have them order in the specified time frame, or help them move them to another dealer prior to the flooring start, or worst case, you reimburse them for any flooring expense.
More ideas tomorrow.
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